Subject: Request by BHI Central
Florida, LLC. to consider a lease agreement for properties located at Leesburg
International Airport

Staff
Recommendation:

Staff
recommends disapproval of lease agreement as presented.

Analysis:

Mr.
Brainerd requested that this item be placed on the agenda for commission
consideration and vote. I have advised Mr. Brainerd that I cannot support this
lease agreement in its present form.

On
Monday, May 20, at 2:30 pm, I met with Mr. Brainerd and others from his firm.
At that time, I advised him that based upon input from the City Attorney, the
corporate name “BHI Central Florida, LLC.” could not be used as a party to any
legal document because it is not a registered corporate identity. As of this
writing, on May 22, it is still not registered – on that count alone, this
lease agreement cannot be recommended for approval.

The
contents of the lease proposed by Mr. Brainerd are at considerable odds with
past practices and the spirit and intent of the proposed lease policy. The
proposed lease is also at odds with the current forms of the leases for the
three properties.

Most
notably, the proposed lease represents a significant loss of revenue to the
airport, totaling approximately ten million dollars over the course of thirty
years. As a secondary concern, there is no justification for a lease term of
greater than 20 years for the lease expiring in October, 2013, and no present
justification for extension of modifications to the other two leases which
expire in some eight to ten years. I have advised Mr. Brainerd that I am
unable to support this proposed lease for these reasons.

Options:

1.
Reject the lease agreement as proposed; or,

2.
Such alternative action as the Commission may deem appropriate.

Fiscal
Impact:

Although
the use of an incorrect corporate name does not allow execution of this lease
as provided by Mr. Brainerd, the terms of the lease agreement serve to reduce
the expected revenues of the airport by some ten million dollars over a period
of thirty years. This severely limits the ability of the airport to perform
capital projects, repair and replacement projects, and perform required
maintenance.